Feb. 3, 2021

Good morning. Kasowitz Benson Torres has seven fewer partners after a group bounced from the firm associated with former President Donald Trump to launch a boutique within the house that David Boies built; Toyota, Fiat Chrysler and other automakers are dropping their Trump era challenge to California's emissions rules; today could see some U.S. Supreme Court rulings; and U.S. District Judge Gregory Woods says he just discovered what the "graham" in "graham crackers" means. Jeff Bezos might be calling it quits, but we're still here!

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Seven Kasowitz partners depart, launch firm housed in Boies Schiller's offices

REUTERS/Yuri Gripas

Seven partners have left Kasowitz Benson Torres, a longtime go-to law firm for former President Donald Trump, and are setting up shop as a litigation boutique housed in the offices of another prominent litigation firm that's suffered partner departures, Boies Schiller Flexner.

Caroline Spiezio reports that Glenn Agre Bergman & Fuentes' founders include bankruptcy attorney Andrew Glenn and trial lawyer Olga Fuentes, who is married to Boies Schiller partner Peter Skinner. They will use "some of our office space in New York and San Francisco while they get themselves going," according to a Boies memo.

Both Kasowitz Benson, led by New York litigator Marc Kasowitz (pictured), and Boies Schiller, the home of famed attorney David Boies, in recent years have seen a series of partner departures as their leaders took on work for controversial clients.

For Kasowitz, that was Trump, a client before and after his 2016 election win. Boies, who repped former Vice President Al Gore in the 2000 election recount fight, found controversy advising the failed blood-testing startup Theranos and disgraced Hollywood producer Harvey Weinstein.

Kasowitz Benson through a spokesperson said it wished the group success and said despite "these challenging times" it just finished "one of its best years ever." Find out more about the new firm.

Toyota, Fiat Chrysler drop support for Trump effort to bar California emissions rules

REUTERS/Denis Balibouse

Toyota Motor, Fiat Chrysler and other major automakers are joining General Motors in abandoning support for the former Trump administration's effort to bar California from setting its own zero emission vehicle rules, David Shepardson reports.

Lawyers for the companies' trade group, the Coalition for Sustainable Automotive Regulation, led by Raymond Ludwiszewski of Gibson Dunn moved to withdraw as intervenors in litigation over the rules before the D.C. Circuit, a day after the National Highway Traffic Safety Administration and EPA under Biden asked the court to put the case on hold.

The automakers, which also include Hyundai Motor, Kia Motors, Mitsubishi Motors, Mazda Motor and Subaru, in a joint statement said they were withdrawing "in a gesture of good faith and to find a constructive path forward" with President Joe Biden.

Their decisions came after GM in November shocked the industry by withdrawing from the case. Nissan Motor followed. California Governor Gavin Newsom praised the automakers on Twitter for "dropping your climate-denying, air-polluting, Trump-era lawsuit against CA."

Biden has directed agencies to quickly reconsider Trump's 2019 decision to revoke California's authority to set its own auto tailpipe emissions standards and require rising numbers of zero-emission vehicles, as well as Trump's national fuel economy rollback. Learn more.

Industry buzz

Former President Donald Trump's newly-tapped lawyers, Bruce Castor and David Schoen, argued in a 14-page brief filed ahead of his second impeachment trial that the U.S. Senate lacks the authority to conduct the proceedings now that he has left office. It's an argument that last week won the support of 45 of the 50 Senate Republicans in a failed vote to dismiss the case. Challenging the Senate's constitutional authority to put a former president on trial would enable Republicans to vote against conviction without directly defending Trump's incendiary remarks ahead of the Jan. 6 riot at the U.S. Capitol. (Reuters)
A brewing, multimillion-dollar legal fight between O'Melveny & Myers and one of its former clients should be held in California, a Canadian trial court ruled. The ruling by British Columbia Supreme Court Justice Amy Francis is a blow to O'Melveny, which has accused cannabis technology company TILT Holdings Inc of failing to pay more than $3 million in legal fees. (Reuters)
Goodwin Procter experienced an indirect security breach involving a third-party vendor whose services the firm uses for large file transfers, according to an internal memo. A "small percentage of our clients may have experienced unauthorized access to or acquisition of confidential information" on Jan. 20, Goodwin managing partner Mark Bettencourt said in the memo. The firm retained a forensic expert and said the investigation is ongoing. (Reuters)
U.S. Supreme Court Justice Clarence Thomas' wife, conservative political activist Virginia Thomas, in a recent email to a private list of his former clerks apologized for a rift that had developed among those on the list following her support for Trump and her endorsement of the Jan. 6 rally that preceded the Capitol riot. "Let's pledge to not let politics divide THIS family, and learn to speak more gently and knowingly across the divide," she wrote. (Washington Post)
People of color, women and LGBTQ lawyers remain underrepresented, especially among equity partners, according to new data from the National Association for Law Placement. But, overall diversity was up slightly. Nearly 10.25% of all U.S. law firm partners were lawyers of color in 2020, compared with 9.55% in 2019. (Reuters)
Notre Dame Law School 3L student Rachel Palmero recently joined the White House staff as assistant press secretary to Vice President Kamala Harris. She's worked in political communications since the 2016 election and will finish up law school while working full-time. (Above The Law)
The Washington State Bar Association, which granted the option of diploma privilege to applicants registered to take the canceled in-person summer bar exam, won't extend the policy further. The state has instead decided that it will hold an online bar exam this month, spurring pushback from law students who claim online exams have been rife with problems including racial profiling. (Above The Law)

Video: Can Biden reshape the judiciary?

More than a dozen circuit and district judges at the federal level have announced plans to take "senior status" - or semi-retire, opening the door for President Joe Biden to begin to shape the federal courts for decades to come, something his predecessor made a priority. Reuters' Tom Rowe has more about what’s at stake. Watch the full video here.

Coming up today

The U.S. Supreme Court is expected to issue opinions in pending cases. Outstanding rulings in cases the justices have already heard this term include its decision on whether to uphold Obamacare and whether to protect Alphabet Inc's Google from a long-running copyright lawsuit by Oracle.
Michael Regan, President Joe Biden's nominee to head the EPA, goes before the U.S. Senate Environment and Public Works Committee for his confirmation hearing.
Mall operator CBL & Associates Properties and lenders led by Wells Fargo will go to trial in Houston bankruptcy court in a dispute over whether, as the result of an alleged loan default, the mall operator had the authority to file for bankruptcy back in November and whether the lenders are now in control of certain CBL properties. CBL is seeking damages and an injunction. Weil Gotshal's Alfredo Perez leads the representation for CBL, while Jones Days' Matt Corcoran is repping Wells Fargo.
U.S. District Judge Edward Davila in San Jose, California, will consider whether to grant class action status in a lawsuit brought by consumers who say Apple knew and concealed how the "butterfly" keyboards on its MacBook laptop computers were prone to failure. Girard Sharp and Chimicles Schwartz Kriner & Donaldson-Smith are seeking to be named class counsel in the litigation. Penelope Preovolos of Morrison & Foerster leads Apple's defense.
Three Louisiana pension funds will urge the 5th Circuit in New Orleans to revive a lawsuit alleging that hedge fund administrator Citco Group misled them as to the value of an offshore fund. Phillip Preis of Preis Gordon and Andrew Gordon of Paul Weiss will argue for the funds and Citco, respectively.
The 5th Circuit will also consider whether to revive for trial claims by a Colorado woman who claimed Sanofi failed to warn that its breast cancer drug Taxotere can cause permanent hair loss. Kelly Gahan's lawsuit was one of thousands of product liability cases over Taxotere that have been consolidated before U.S. District Judge Jane Triche Milazzo in New Orleans. The judge ruled Gahan could not establish Sanofi caused her injury because both she and her doctor knew Taxotere could pose a risk of permanent hair loss. Darin Schanker of Bachus & Schanker is lead counsel for Gahan, and Ilana Eisenstein of DLA Piper represents Sanofi.

Data dive: Manhattan D.A. Cyrus Vance lags in fundraising as rivals move to replace him

REUTERS/Eduardo Munoz

Reuters data journalist Rick Linsk checks out the state of the race for Manhattan district attorney.

He's investigating former President Donald Trump and prosecuted Harvey Weinstein, but Manhattan District Attorney Cyrus Vance is far behind several opponents in his potential re-election campaign. That's led to questions of whether he plans to run again. All his challengers are Democrats. Political observers note that the winner of the June 22, 2021, primary election is all but assured of victory in November given Democrats' dominance in New York politics. Here's who's leading the pack in fundraising to potentially replace him.

"Before reading the complaint in this case, this judge did not know that the 'graham' in graham cracker referred to a type of flour: the crackers might have been named after a famous person named Graham, in the way that Peach Melba and Melba Toast were named after an opera singer. But in evaluating the allegations here, the Court cannot assume that consumers will be equally ignorant of the clear-cut meaning of the term 'graham.' "

U.S. District Judge Gregory Woods in Manhattan, in rejecting Whole Foods Market’s arguments that he should throw out a proposed class action claiming it deceived shoppers about the contents of its 365 Organic Honey Graham Crackers. The company's lawyers, led by Brian Blackman of Blaxter Blackman, rejected the argument that the packaging would lead reasonable consumers to wrongly believe the graham crackers contained more whole grain flour than non-whole grain flour, and more honey than sugar. (Reuters)

In the courts

McDonald's Corp may move forward with a lawsuit seeking to recoup tens of millions of dollars in severance and benefits from former CEO Steve Easterbrook, who it claims covered up and lied about sexual relationships with at least three employees. Delaware Vice Chancellor Joseph Slights declined to dismiss the lawsuit, which William Savitt of Wachtell Lipton and Ronald Olson of Munger Tolles are pursuing on behalf of McDonald's. (Reuters)
Amazon.com Inc has agreed to pay more than $61.7 million to settle allegations by the FTC that it failed to pay Amazon Flex drivers some of the tips given by customers over more than two years. The money will be used to compensate drivers. Amazon, represented by lawyers including James Howard of Davis Wright Tremaine and Maureen Ohlhausen of Baker Botts, neither admitted nor denied the allegations in settling. (Reuters)
Manhattan District Attorney Cyrus Vance's office is weighing whether to bring state court charges against Stephen Bannon, people familiar with the matter told The Washington Post, after the onetime adviser to Donald Trump while under federal indictment was pardoned by the former president. Federal prosecutors had charged him with swindling Trump's own supporters over an effort to raise private funds to build the president’s wall on the U.S.-Mexico border. Bannon has been represented by Davidoff Hutcher & Citron's Robert Costello. (Washington Post)
Indigenous and environmental groups including the Center for Biological Diversity lost a bid to block winter construction activities that are part of oil producer ConocoPhillips' up to $3 billion plan for drilling in the National Petroleum Reserve in Alaska. U.S. District Judge Sharon Gleason in Anchorage declined to enjoin the Bureau of Land Management from authorizing ConocoPhillips to build roads and open a gravel mine as part of the project. ConocoPhillips is repped by Jason Morgan and Ryan Steen of Stoel Rives. (Reuters)
A group of 35 state attorneys general are throwing their support behind an appeal of a judge's decision that declared the Telephone Consumer Protection Act unconstitutional and unenforceable for robocalls made from 2015 to 2020. The states' amicus brief was one of several filed with the 6th Circuit backing the revival of a proposed class action against energy supplier Realgy LLC over unsolicited calls. (Reuters)
California law requiring employers to put certain information on wage statements applies to United Airlines pilots and flight attendants based in the state even though they spend most of their time elsewhere, the 9th Circuit concluded. The court rejected arguments by United counsel Adam KohSweeney of O'Melveny & Myers that California law is preempted by the federal Airline Deregulation Act of 1978 and the U.S. Constitution's Dormant Commerce Clause. Kirk Hanson of Jackson Hanson reps the plaintiffs. (Reuters)
The 4th Circuit is giving Bayer another shot at getting damages from Belmora LLC in a false advertising lawsuit over the painkiller brand name Flanax, concluding a lower-court judge wrongly determined the lawsuit was time-barred. Bayer has long sold sodium naproxen in the United States as Aleve and in Mexico as Flanax, and Belmora has since 2004 sold Flanax-branded naproxen sodium in the United States. (Reuters)
U.S. District Judge William Orrick in San Francisco chose six cases brought by local governments and school boards as bellwethers in the multidistrict litigation over allegations that Juul Labs fueled a youth addiction epidemic. They include four cases favored by plaintiffs and two by the e-cigarette maker. Sarah London of Lieff Cabraser Heimann & Bernstein reps the plaintiffs and Gregory Stone of Munger, Tolles & Olson reps Juul. (Reuters)

Industry moves

Cooley has added London-based partner Guadalupe Sampedro to its cybersecurity, data and privacy practice. She joins from Bird & Bird and was previously European Union data protection officer and privacy director for Europe, the Middle East, Africa and Latin America at PayPal. (Reuters)
Paul Murphy, who most recently served as chief of staff to FBI Director Chris Wray, has rejoined King & Spalding as a partner in D.C. on its special matters and government investigations team. Wray was also a partner at King & Spalding. (Reuters)
Litigator Steven Forry has joined Gordon Rees Scully Mansukhani's Pittsburgh office as a partner in its healthcare and product and general liability practice groups. He was previously at Marshall Dennehey Warner Coleman & Goggin. (Gordon Rees)
Brenna Jenny has rejoined Sidley Austin as a partner in D.C. in the firm's healthcare and FDA practice after serving in senior legal posts at the U.S. Department of Health & Human Services and the DOJ. She served as the principal deputy general counsel of HHS and chief legal officer for the U.S. Centers for Medicare & Medicaid Services. (Sidley Austin)
Labor and employment lawyer Brian Balonick has left Cozen O'Connor to join Fisher Phillips' Pittsburgh office as regional managing partner. (Fisher Phillips)
WilmerHale has added Michael Dawson as a partner in its securities and financial services department, based in D.C. He joins the firm after 16 years at Promontory Financial Group, where he was a managing director. (WilmerHale)
Holland & Knight has opened an office in Orange County, California, with a seven-litigator team formerly with Enterprise Counsel Group led by David Robinson, who was ECG's president. (Holland & Knight)

Columnist spotlight

DOJ urges Supreme Court to vacate certification of Goldman shareholder class. The DOJ and the SEC weighed in Monday in Goldman Sachs v. Arkansas Teacher Retirement System, the Supreme Court case that Goldman Sachs has billed as the most important shareholder class action to come before the justices since Halliburton v. Erica P. John Fund. The bank's shareholders allege that Goldman lied when it said in public statements prior to the mortgage crisis that it put customers' interests before those of the bank and that it strived to avoid conflicts. Alison Frankel found the government's brief backing shareholders on some key points surprising. But the government is also urging the Supreme Court to vacate the 2nd Circuit decision certifying investors as a class. Frankel takes a look at the brief and how the government’s call for the justices to send the case back to the 2nd Circuit for another look at class certification may not be good news. Read her full column here.

Law firms (selectively) welcome back Trump alums. The revolving door of big shot lawyers seamlessly cycling from private practice to government appointment and back again is a time-honored legal business tradition inside the Beltway and is proving to be impressively durable. Because for all the buzz about the "Scarlett T," many law firms have been perfectly willing to hire former high-ranking Trump administration lawyers, with some exceptions. Jenna Greene takes a look at what firms like Jones Day; Duane Morris; King & Spalding; and Gibson, Dunn & Crutcher are taking into account when adding lawyers from the Trump administration. The key might lie in what they did before joining the government, especially if the lawyers were not viewed as part of the president’s inner circle. Read her full column here.

Check out other recent pieces from all our columnists: Alison Frankel, Jenna Greene and Hassan Kanu.

Lawyer speak: DOJ netted more than $2.2 billion in procurement fraud recoveries in FY 2020

The DOJ obtained more than $2.2 billion in False Claims Act settlements and judgments in the fiscal year ending Sept. 29, 2020, driven mostly by matters involving the healthcare industry. Aron Beezley of Bradley Arant Boult Cummings outlines the more notable recoveries from 2020 and how procurement fraud undoubtedly will continue to be a significant focus for DOJ in 2021.

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